Hiring Picks Up, But ObamaCare Shift Seen In Retail

The U.S. added 165,000 jobs in April, the Labor Department said Friday, while the jobless rate edged down to 7.5%, the lowest since December 2008.

Economists had forecast nonfarm payrolls to rise by 153,000, The jobless rate was expected to remain at 7.6%. In addition, February and March hiring were revised up by a net 114,000.

Stocks jumped at the market open on hopes that the job market and overall economy are doing better than many had feared.

However, the labor force participation rate remained at a decades-low 63.3%. If participation had held constant since December 2007, when the recession started, the jobless rate would still be 11%.

Private-sector jobs rose by 176,000, with government jobs down by 11,000. Service-sector jobs expanded by 176,000.

Retail jobs jumped by 29,300, the most this year. But the retail work week tumbled to a three-year low of 30 hours from 30.3 in March. Total retail hours worked fell nearly 1% — even with the increase in retail jobs. These changes could reflect retailers and other modest-wage employers slashing work hours to try to avoid ObamaCare employer mandates. Other data show retailers and additional private service-sector firms slashing benefits in response to the 2010 health law.

Meanwhile, temporary jobs shot up by 30,800 in April, the biggest gain in 13 months. That could foreshadow more permanent hiring — or cautious employers trying to avoid permanent hires amid a sluggish economy and looming ObamaCare. Overall part-time work rose last month.

Goods-producing jobs fell by 9,000 last month, with manufacturing employment flat and construction down 6,000.

Labor market data heading into Friday's employment report had been mixed. Initial jobless claims fell by 18,000 last week to 324,000, the lowest since January 2008, Labor said Thursday. Planned job cuts announced in April fell 6% vs. a year earlier, according to Challenger, Gray & Christmas.

Other reports have pointed to weak hiring activity — not heavy layoffs — as the main reason net job growth has been so sluggish. The ADP Employment Survey released Wednesday estimated that private payrolls rose just 119,000, below estimates, while February's gain was revised down.

Other economic indicators suggest the U.S. growth has slowed down after hopeful signs at the start of the year. The Institute for Supply Management's manufacturing index dipped to 50.7 last month, barely above the break-even 50 level. Construction spending unexpectedly fell sharply in March, despite further gains in homebuilding.

Gross domestic product rose at a 2.5% annual rate in the first quarter, the Commerce Department said April 26. That was less than expected. And with business investment's pace slowing and consumer spending gains cooling as spring began, so-so Q1 GDP could be the year's highlight.

The Federal Reserve signaled Wednesday that it could increase its bond-buying program, currently $85 billion a month. But policymakers did not seem overly alarmed by recent economic data, suggesting no quantitative easing change was likely.

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